Here an update to the oil chart I've been posting. Remember these TL's start 12 years ago and I'm using this to help you see how important long TL's are. Dashed are TL's. When I referred to "Zones" I was using the while lines as channels and the blue as horizontals all equally spaced. On Friday in the 30 min Euro chart I made a comment when we had a pop up and fast reverse down and back up again that left the candles with a really big wick top on the green candle and same big bottom wick on the next red. I mentioned shockwave but didn't want to go into any details as to how to know when as it's not what we are doing just now (that set-up was complex). However the daily oil illustrates a very simple shockwave pattern. By shockwave (my term) I mean PA reacts like it got an electric shock. The clue was the prior tail reacting on a confirmed blue support. Talk had started that oil was a blow-off short and a few posts had appeared on ET. Previously I used these levels to say oil could pullback to the 120'ish level and still be in the new zone meaning expect more strength. So here we have a 12 year old line with a tail bounce and run up followed by a slide back to the support again. This is where I expect PA to react like it got an electric shock. This was an easy intraday play ATM from 12 yr old lines. As an aside, imagine being in oil-man G Bush's shoes. Everytime he mentions Iran & War the oil price goes crazy and he and his best buddies make a killing. I bet Georgie tipped off a few of his funny handshake brigade! The lesson here applies to any TF chart in any market.
Well, a couple of observations...there wasn't any profit taking Friday, price closed on the extreeme high... There's a longer term uptrendline which lines up with reaction to the back side of it coinciding with a possible triple top (previous high's, 1.5815) on Monday, my guess is it will break it. IMHO these strong moves happen in three stages. Not to be missed is the big fellas getting together for a weekend party...what they said will make a difference, perhaps a gap open Monday? who cares? small timeframes will keep you on the right side of the market no matter what happens.
Cannot say for sure magicdust....was hoping Yoohoo or someone else with expirience would comment, that's why i said: "i don't want to come across as a guru....."
Take a look at gold on Thursday...pinbars on hourly, 4hour and finaly daily TF's....an omen for Friday's action?
The last time a daily candle ended on a daily high (barring one or two very small candles) was May 16 2003. This was also on a Friday, and occurred as EURUSD had traded at an all-time high four days earlier. On Monday 19th, it gapped up 70 pips and went on to make new all-time highs in the next weeks.